As an employer offering jobs, you’ll be required to pay unemployment and Worker’s Compensation insurance. Depending on the number of employees and hours worked, those premiums can become substantial.

I don’t know about you, but I like to do what I can to keep as much of my hard-earned cash as possible. Turns out, you can do something to help lower your LNI insurance rate! Keep reading.

LNI is a type of workplace insurance administered by the State, therefore many factors apply when they set premium rates, including risk in our industry as a whole and your company specifically, your experience, and claims against your account.

Some years back my own total LNI rate was up to $1.32 per EE work/hour. Meaning that for each and every hour one of my employee worked, the total premium paid to LNI was $1.32. Multiply this by, say 40 hours per week = $53.80 premium per week, or about $221.76 per month.

When you have more employees, this number compounds quickly. For example, I employ 11 staff averaging 1600 hours per month. So 1600 hours * $1.32 = $2,164.80 premium per month – ouch!

About 20-25% of that premium is paid by the employee, the rest is paid by you, the employer.

Needless to say that cost was a huge burden. Here is how I lowered my total rate down from $1.32 to $.68 per hour.

6 Steps You Can Take To Help Reduce Your LNI Insurance Cost

1. Look at your “experience factor;” is it above or below 1.0? If it’s above 1.0 it’s probably because you have claims or some other issue causing you a higher risk – take measure to lower it below 1.0.

2. Create a safety and an accident prevention program for your business. Then share it with your LNI account manager and ask them to lower your rate based on it.

3. Create a “light duty” job description and if/when you have claims, get those employees back on light duty ASAP.

4. Take every measure you can think of to keep your account claims-free.

5. Use Tammy’s advice – get an LNI risk management consult. It’s available to everyone. They can give you personalized tips on safety program, injury prevention, and how to reduce your insurance and claims costs. Keep in mind if they find something wrong with safety, you may be required to fix it, but then again, doing so should help lower your risk/rate.

6. If you have no claims against your account, ask your LNI account manager if you can get a “claim-free discount.” They will tell if or how to qualify.


Joseph Spada
Joseph Spada

Adult Family Home Consultant, geriatric nurse, owner of Spada Care Homes, Ohana Hale Senior Living, and Savanna Healthcare; DSHS instructor of the AFH Administrator Training; speaker; author.

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